The State Of The Foodservice Packaging Industry: Optimism Reigns

Falls Church, VA - The Foodservice & Packaging Institute, Inc., (FPI) the trade association for converters, raw material and machinery suppliers of foodservice packag-ing products, has released its sixth annual "State of the Industry Report."

The 150-page report seeks to provide a snapshot of the foodservice packaging industry from sources both inside and outside the industry. The report contains six sections of data, in-cluding the findings of the sixth Annual Foodservice Packaging Industry Survey; News of the Industry; Industry Facts & Trends; U.S. Domestic Statistics; U.S. Exports and Imports of Food-service Packaging.

Of particular interest is FPI's "Annual Foodservice Packaging Industry Survey," which collects information and opinions from foodservice packaging manufacturers and suppliers in North America and Europe. This year, about three quarters of single-use foodservice packaging converters in both Europe and North America said they expect their sales volumes to be better this year than last, and more than half of the respondents expected their profits to be better than last year.

"As the economy has stabilized in recent years, the optimism of those in the foodservice packaging industry has grown," said John R. Burke, FPI president. "This year's survey data re-flects that optimism. Manufacturers are very bullish about the immediate future of the busi-nesses."

The converters' suppliers shared their optimism. All of the machinery suppliers who re-sponded said they expected 2005 to be better than last year in terms of both volume and profit. Eighty percent of raw material suppliers agreed in terms of volume, and three quarters of them expected profits to be better in 2005.

Looking to the individual markets for single-use packaging products, the quick/fast cas-ual market shows no signs of slowing down, as it was ranked as the top market where respon-dents believe strong growth for foodservice packaging will occur in the next five years. Other top vote getters were chain quick service restaurants and convenience stores.

When asked about the challenges facing the industry, "margin compression" still reigns supreme as the top challenge, both here and in Europe. "Globalization and competition from out-side national borders" came in second with European converters and North American machinery suppliers and third for North American converters and raw material suppliers. Across the board, "increasing raw material costs" was the other big challenge.

SOURCE: Foodservice & Packaging Institute, Inc. (FPI)